From: AlanBaggett@volcanomail.com   
      
   Taxes without the filing headaches? It's already happening in some countries :   
   CRA SOTW   
      
   Why do you have to tell the Canadian Revenue Agency what they already know?   
      
   By Don Pittis, CBC NewsPosted: Mar 23, 2015 7:56 AM ET   
      
      
   In Finland, if you have a straightforward tax return, you don't have to fill   
   out any forms at all. Using tax data beamed electronically to the government,   
   each April, the Finnish tax department sends every taxpayer a completed, or in   
   their language a "   
   prepopulated," tax form.   
      
   "The Finnish tax authorities have printed a set of prepopulated facts on your   
   income," says the Nordisk eTax website. "These facts include wages, pensions,   
   receipts of dividend etc."   
      
   Under the Finnish system, you don't even have to respond unless there are   
   "errors or omissions." Effectively, the government is admitting that it   
   already knows all your secrets.    
      
   Big Brother?   
      
   It may sound frighteningly like Big Brother, but the fact is that all modern   
   governments, including those here in Canada, have access to similar   
   information. While some parts of government continue to struggle with secure   
   electronic data (notably, the    
   health care sector), for the Canada Revenue Agency and tax collectors   
   worldwide, computerization has been a perfect fit. And largely, the CRA has   
   worked out the bugs.   
      
   Come tax time, T-slips from employers, pension plans, banks, investment income   
   sources and other government departments are sent directly to you -- many in a   
   paper form. But according to University of Alberta tax expert Christopher   
   Sprysak, you aren't    
   the only one who gets this detailed information about your income and personal   
   finances.   
      
   "The CRA gets the same copy that you do and, in fact, that's uploaded into   
   their system," says Sprysak.   
   One of the great advantages of this system, according to Sprysak, is that   
   unlike fallible humans transferring numbers from paper forms, computers just   
   don't make transposition mistakes.    
      
   Error-free   
      
   That's also the reason why the CRA is increasingly encouraging Canadians to   
   file their returns electronically.   
      
   "Because the CRA doesn't re-key the information, there is less chance of   
   errors," said CRA spokesman Philippe Brideau in an email.   
      
   The CRA does put some of its tax forms online, but to file digitally, you have   
   to use third-party tax software. (Kevin Lamarque/Reuters)   
      
   From my first exposure to Basic and Fortran more than 40 years ago, it was   
   obvious that besides pure math, the things computers did first and best was   
   the kind of data processing that tax departments live for. And while the CBC   
   has been chronicling a    
   decade-long move to electronic filing, Brideau says the process is not yet   
   finished.   
      
   "We are always improving our services to Canadians. When we introduce a new   
   service, we always look to enhance and improve the experience to taxpayers,"   
   said Brideau.   
      
   A report on the increase in the use of online tax services from the OECD, the   
   rich country government think-tank, agrees. "Revenue bodies' plans give   
   primary emphasis to reducing taxpayers' compliance burden, with improved   
   operational efficiency as a    
   clear secondary goal," says the report.   
   Forms still too complex   
      
   Transmitting tax information electronically reduces the chance of error when   
   the tax agency is processing your return, says the CRA.   
      
   But some experts in tax filing I spoke to said that, partly because of an   
   irrational fear of numbers and partly because of an excessively complex tax   
   system, many Canadians are being left behind by the government's move to   
   electronic services.   
      
   "For anyone who is conversant with the technology and is able to use   
   tax-preparation programs, a lot of that complexity is solved for them," says   
   Michael Deturbide, a Dalhousie University professor who studies law and   
   technology. "But if you're doing    
   just a paper return, you can understand why the basic simple T1, people take   
   it to H&R Block now because it's become so complicated."    
      
   Tax preparers like Kirby Dickson, right, the head accountant at H&R Block's   
   Shuter and Yonge St. location in Toronto, will soon be able to pre-populate   
   tax returns with clients' information received from the CRA. (Evan Mitsui/CBC)   
      
   The OECD says one of the ways of reducing the burden on taxpayers is to offer   
   the kind of services provided by Finland, such as "pre-filling" tax returns.   
      
   "Pre-filling has evolved to become a significant strategy for 'transforming'   
   service delivery in administering the personal income tax in quite a few   
   countries," says the OECD report. "There are a number of revenue bodies that   
   now offer a fully automated    
   end-to-end process, thereby providing significant benefits to their taxpayers."   
      
   And according to Brideau, the CRA is already moving in that direction.   
      
   New system will auto-populate return   
      
   "The new Tax Data Delivery service marks the beginning of our effort to   
   auto-populate certain tax return fields to ease Canadians' burden with filling   
   out tax forms," said Brideau. "Tax preparers will be able to receive their   
   client's information    
   directly into their software."   
      
   Vern Krishna wrote the book on Canadian taxes, literally. "It's my favourite   
   subject," said the author of The Fundamentals of Canadian Income Tax, which   
   has been in print, with updates, for about 30 years.   
      
   Krishna says there is no reason that the CRA could not follow Finland's lead   
   and eliminate tax filing for millions, maybe even the majority, of Canadians.   
   But he says the Canadian tax system is still catching up.   
   "The CRA and its system is frankly pretty backward and not as progressive as   
   some countries," said Krishna.   
      
   "Of course, they have the data and they have the information," he says, "But   
   they don't use that information in a particularly efficient manner that would   
   make it easier for the taxpayer."   
      
   And Krishna is not optimistic that the Finnish system is coming to Canada any   
   time soon.   
      
   "Let's put it this way, they're not taxpayer-sensitive," says Krishna of the   
   CRA. "They're more attuned to their own needs and the needs of the   
   bureaucracy."   
      
      
   ----------------------------------------------------------   
   Miss a Tax Tale Miss a lot!   
   Visit the CRA SOTW Library at http://canada.revenue.agency.angelfire.com   
      
   ------------------------------------------------------------   
   Alan Baggett - http://www.taxcollectorsbible.com/ - Tax Collector's Bible   
      
   --- SoupGate-Win32 v1.05   
    * Origin: you cannot sedate... all the things you hate (1:229/2)